Item 16. Form 10-K Summary

Not applicable

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

				THE TJX COMPANIES, INC.
						/s/ SCOTT GOLDENBERG
Dated: April 4, 2018						Scott Goldenberg, Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the date indicated.

/s/ ERNIE HERRMAN Ernie Herrman, Chief Executive Officer, President and Director (Principal Executive Officer)		/s/ SCOTT GOLDENBERG Scott Goldenberg, Chief Financial Officer (Principal Financial and Accounting Officer)
ZEIN ABDALLA* Zein Abdalla, Director		AMY B. LANE* Amy B. Lane, Director
JOSE B. ALVAREZ* José B. Alvarez, Director		CAROL MEYROWITZ* Carol Meyrowitz, Executive Chairman of the Board of Directors
ALAN M. BENNETT* Alan M. Bennett, Director		JACKWYN L. NEMEROV* Jackwyn L. Nemerov, Director
DAVID T. CHING* David T. Ching, Director		JOHN F. O’BRIEN* John F. O’Brien, Director
MICHAEL F. HINES* Michael F. Hines, Director		WILLOW B. SHIRE* Willow B. Shire, Director

		*BY		/s/ SCOTT GOLDENBERG
Dated: April 4, 2018				Scott Goldenberg, as attorney-in-fact

The TJX Companies, Inc.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

For Fiscal Years Ended February 3, 2018, January 28, 2017 and January 30, 2016.

Report of Independent Registered Public Accounting Firm			F-2
Consolidated Financial Statements:
Consolidated Statements of Income for the fiscal years ended February 3, 2018, January 28, 2017 and January 30, 2016			F-4
Consolidated Statements of Comprehensive Income for the fiscal years ended February 3, 2018, January 28, 2017 and January 30, 2016			F-5
Consolidated Balance Sheets as of February 3, 2018 and January 28, 2017			F-6
Consolidated Statements of Cash Flows for the fiscal years ended February 3, 2018, January 28, 2017 and January 30, 2016			F-7
Consolidated Statements of Shareholders’ Equity for the fiscal years ended February 3, 2018, January 28, 2017 and January 30, 2016			F-8
Notes to Consolidated Financial Statements			F-9
Financial Statement Schedules:
Schedule II – Valuation and Qualifying Accounts			45

F-1

Report of Independent Registered Public Accounting Firm

To The Board of Directors and Shareholders of The TJX Companies, Inc.:

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of The TJX Companies, Inc. and its subsidiaries (the “Company”) as of February 3, 2018 and January 28, 2017, and the related consolidated statements of income, comprehensive income, shareholders’ equity and cash flows for each of the three years in the period ended February 3, 2018, including the related notes and financial statement schedule listed in the accompanying index listed within Item 15 (a) (collectively referred to as the “consolidated financial statements”). We also have audited the Company’s internal control over financial reporting as of February 3, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of February 3, 2018 and January 28, 2017, and the results of their operations and their cash flows for each of the three years in the period ended February 3, 2018 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of February 3, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Basis for Opinions

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Annual Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail,

F-2

accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/PricewaterhouseCoopers LLP

Boston, Massachusetts

April 4, 2018

We have served as the Company’s auditor since 1962.

F-3

The TJX Companies, Inc.

CONSOLIDATED STATEMENTS OF INCOME

		Fiscal Year Ended
Amounts in thousands except per share amounts		February 3, 2018				January 28, 2017				January 30, 2016
		(53 weeks)
Net sales		$	35,864,664			$	33,183,744			$	30,944,938
Cost of sales, including buying and occupancy costs			25,502,167				23,565,754				22,034,523
Selling, general and administrative expenses			6,375,071				5,768,467				5,205,715
Impairment of goodwill and other long-lived assets, related to Sierra Trading Post (“STP”)			99,250				—				—
Loss on early extinguishment of debt			—				51,773				—
Pension settlement charge			—				31,173				—
Interest expense, net			31,588				43,534				46,400
Income before provision for income taxes			3,856,588				3,723,043				3,658,300
Provision for income taxes			1,248,640				1,424,809				1,380,642
Net income		$	2,607,948			$	2,298,234			$	2,277,658
Basic earnings per share:
Net income		$	4.10			$	3.51			$	3.38
Weighted average common shares – basic			636,827				655,647				673,484
Diluted earnings per share:
Net income		$	4.04			$	3.46			$	3.33
Weighted average common shares – diluted			646,105				664,432				683,251
Cash dividends declared per share		$	1.25			$	1.04			$	0.84

The accompanying notes are an integral part of the financial statements.

F-4

The TJX Companies, Inc.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

		Fiscal Year Ended
Amounts in thousands		February 3, 2018				January 28, 2017				January 30, 2016
		(53 weeks)
Net income		$	2,607,948			$	2,298,234			$	2,277,658
Additions to other comprehensive income:
Foreign currency translation adjustments, net of related tax provisions of $36,929 and $25,656 in fiscal 2018 and fiscal 2017, respectively, and benefit of $41,048 in fiscal 2016			211,752				(52,611	)			(143,923	)
Recognition of net gains/losses on benefit obligations, net of related tax provision of $8,989 in fiscal 2018, benefit of $7,394 in fiscal 2017 and provision of $6,335 in fiscal 2016			24,691				(11,239	)			9,629
Reclassifications from other comprehensive income to net income:
Pension settlement charge, net of related tax provision of $12,369 in fiscal 2017			—				18,804				—
Amortization of loss on cash flow hedge, net of related tax provisions of $438, $450 and $450 in fiscal 2018, 2017 and 2016, respectively			696				684				684
Amortization of prior service cost and deferred gains/losses, net of related tax provisions of $9,592, $11,584, and $13,501 in fiscal 2018, 2017 and 2016, respectively			15,228				17,608				20,523
Other comprehensive income (loss), net of tax			252,367				(26,754	)			(113,087	)
Total comprehensive income		$	2,860,315			$	2,271,480			$	2,164,571

The accompanying notes are an integral part of the financial statements.

F-5

The TJX Companies, Inc.

CONSOLIDATED BALANCE SHEETS

		Fiscal Year Ended
Amounts in thousands except share amounts		February 3, 2018				January 28, 2017
ASSETS
Current assets:
Cash and cash equivalents		$	2,758,477			$	2,929,849
Short-term investments			506,165				543,242
Accounts receivable, net			327,166				258,831
Merchandise inventories			4,187,243				3,644,959
Prepaid expenses and other current assets			706,676				373,893
Total current assets			8,485,727				7,750,774
Net property at cost			5,006,053				4,532,894
Non-current deferred income taxes, net			6,558				6,193
Goodwill			100,069				195,871
Other assets			459,608				398,076
TOTAL ASSETS		$	14,058,015			$	12,883,808
LIABILITIES
Current liabilities:
Accounts payable		$	2,488,373			$	2,230,904
Accrued expenses and other current liabilities			2,522,961				2,320,464
Federal, state and foreign income taxes payable			114,203				206,288
Total current liabilities			5,125,537				4,757,656
Other long-term liabilities			1,320,505				1,073,954
Non-current deferred income taxes, net			233,057				314,000
Long-term debt			2,230,607				2,227,599
Commitments and contingencies (See Note L and Note N)
SHAREHOLDERS’ EQUITY
Preferred stock, authorized 5,000,000 shares, par value $1, no shares issued			—				—
Common stock, authorized 1,200,000,000 shares, par value $1, issued and outstanding 628,009,022 and 646,319,046, respectively			628,009				646,319
Additional paid-in capital			—				—
Accumulated other comprehensive income (loss)			(441,859	)			(694,226	)
Retained earnings			4,962,159				4,558,506
Total shareholders’ equity			5,148,309				4,510,599
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		$	14,058,015			$	12,883,808

The accompanying notes are an integral part of the financial statements.

F-6

The TJX Companies, Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS

		Fiscal Year Ended
Amounts in thousands		February 3, 2018				January 28, 2017				January 30, 2016
		(53 weeks)
Cash flows from operating activities:
Net income		$	2,607,948			$	2,298,234			$	2,277,658
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			725,957				658,796				616,696
Loss on property disposals and impairment charges			8,871				5,207				3,383
Deferred income tax (benefit) provision			(137,440	)			(5,503	)			31,204
Share-based compensation			101,362				102,251				94,107
Impairment of goodwill and long-lived assets, related to STP			99,250				—				—
Loss on early extinguishment of debt			—				51,773				—
Pension settlement charge			—				31,173				—
Excess tax benefits from share-based compensation			—				(70,999	)			(64,680	)
Changes in assets and liabilities:
(Increase) in accounts receivable			(62,358	)			(23,235	)			(27,357	)
(Increase) decrease in merchandise inventories			(450,377	)			11,862				(506,633	)
(Increase) in prepaid expenses and other current assets			(317,850	)			(9,600	)			(40,103	)
Increase in accounts payable			205,111				48,253				216,265
Increase in accrued expenses and other liabilities			334,522				389,399				284,929
(Decrease) increase in income taxes payable			(94,492	)			146,766				68,014
Other			5,120				(7,518	)			3,432
Net cash provided by operating activities			3,025,624				3,626,859				2,956,915
Cash flows from investing activities:
Property additions			(1,057,617	)			(1,024,747	)			(889,380	)
Purchases of investments			(861,256	)			(716,953	)			(798,008	)
Sales and maturities of investments			906,137				529,146				681,377
Acquisition of Trade Secret			—				(2,324	)			(57,104	)
Net cash (used in) investing activities			(1,012,736	)			(1,214,878	)			(1,063,115	)
Cash flows from financing activities:
Proceeds from issuance of long-term debt			—				992,540				—
Cash payments for extinguishment of debt			—				(425,584	)			—
Cash payments for debt issuance expenses			—				(9,921	)			—
Cash payments on build to suit leases			(3,138	)			—				—
Cash payments for rate lock agreement			—				(3,150	)			—
Cash payments for repurchase of common stock			(1,644,581	)			(1,699,998	)			(1,828,297	)
Proceeds from issuance of common stock			133,687				164,190				132,033
Cash payments of employee tax withholdings for performance based stock awards			(19,274	)			(24,965	)			(19,572	)
Excess tax benefits from share-based compensation			—				70,999				64,680
Cash dividends paid			(764,040	)			(650,988	)			(544,271	)
Net cash (used in) financing activities			(2,297,346	)			(1,586,877	)			(2,195,427	)
Effect of exchange rate changes on cash			113,086				9,272				(96,675	)
Net (decrease) increase in cash and cash equivalents			(171,372	)			834,376				(398,302	)
Cash and cash equivalents at beginning of year			2,929,849				2,095,473				2,493,775
Cash and cash equivalents at end of year		$	2,758,477			$	2,929,849			$	2,095,473

The accompanying notes are an integral part of the financial statements.

F-7

The TJX Companies, Inc.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

		Common Stock								Additional Paid-In Capital				Accumulated Other Comprehensive Income (Loss)				Retained Earnings				Total
Amounts in thousands		Shares				Par Value $1
Balance, January 31, 2015			684,733			$	684,733			$	—			$	(554,385	)		$	4,133,882			$	4,264,230
Net income			—				—				—				—				2,277,658				2,277,658
Other comprehensive income (loss), net of tax			—				—				—				(113,087	)			—				(113,087	)
Cash dividends declared on common stock			—				—				—				—				(564,586	)			(564,586	)
Recognition of share-based compensation			—				—				94,107				—				—				94,107
Issuance of common stock under stock incentive plan and related tax effect			5,317				5,317				171,733				—				—				177,050
Common stock repurchased			(26,554	)			(26,554	)			(265,840	)			—				(1,535,903	)			(1,828,297	)
Balance, January 30, 2016			663,496				663,496				—				(667,472	)			4,311,051				4,307,075
Net income			—				—				—				—				2,298,234				2,298,234
Other comprehensive income (loss), net of tax			—				—				—				(26,754	)			—				(26,754	)
Cash dividends declared on common stock			—				—				—				—				(680,183	)			(680,183	)
Recognition of share-based compensation			—				—				102,251				—				—				102,251
Issuance of common stock under stock incentive plan and related tax effect			5,101				5,101				204,873				—				—				209,974
Common stock repurchased			(22,278	)			(22,278	)			(307,124	)			—				(1,370,596	)			(1,699,998	)
Balance, January 28, 2017			646,319				646,319				—				(694,226	)			4,558,506				4,510,599
Net income			—				—				—				—				2,607,948				2,607,948
Other comprehensive income (loss), net of tax			—				—				—				252,367				—				252,367
Cash dividends declared on common stock			—				—				—				—				(793,878	)			(793,878	)
Recognition of share-based compensation			—				—				101,362				—				—				101,362
Issuance of common stock under stock incentive plan and related tax effect			3,895				3,895				110,597				—				—				114,492
Common stock repurchased			(22,205	)			(22,205	)			(211,959	)			—				(1,410,417	)			(1,644,581	)
Balance, February 3, 2018			628,009			$	628,009			$	—			$	(441,859	)		$	4,962,159			$	5,148,309

The accompanying notes are an integral part of the financial statements.

F-8

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note A. Basis of Presentation and Summary of Accounting Policies

Basis of Presentation****: The Consolidated Financial Statements and Notes thereto of The TJX Companies, Inc. (referred to as “TJX,” “we” or “the Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the financial statements of all of TJX’s subsidiaries, all of which are wholly owned. All of its activities are conducted by TJX or its subsidiaries and are consolidated in these financial statements. All intercompany transactions have been eliminated in consolidation.

Fiscal Year****: TJX’s fiscal year ends on the Saturday nearest to the last day of January of each year. The fiscal year ended February 3, 2018 (“fiscal 2018”) was a 53-week fiscal year. Fiscal 2017 and 2016 were 52-week fiscal years.

Use of Estimates****: The preparation of TJX’s financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting period. TJX considers its accounting policies relating to inventory valuation, impairment of long-lived assets, goodwill and tradenames, retirement obligations, share-based compensation, casualty insurance, reserves for uncertain tax positions and loss contingencies to be the most significant accounting policies that involve management estimates and judgments. Actual amounts could differ from those estimates, and such differences could be material.

Summary of Accounting Policies

Revenue Recognition: TJX records revenue at the time of sale and receipt of merchandise by the customer, net of a reserve for estimated returns. We estimate returns based upon our historical experience. We defer recognition of a layaway sale and its related profit to the accounting period when the customer receives the layaway merchandise. Proceeds from the sale of gift cards as well as the value of store cards issued to customers as a result of a return or exchange are deferred until the customers use the cards to acquire merchandise. Based on historical experience, we estimate the amount of gift cards and store cards that will not be redeemed (referred to as breakage) and, to the extent allowed by local law, these amounts are amortized into income over the redemption period. Revenue recognized from breakage was $21.1 million in fiscal 2018, $20.5 million in fiscal 2017 and $13.8 million in fiscal 2016. We estimate the date of receipt by the customer when recognizing revenue from sales by our e-commerce operations and shipping and handling costs charged to the customer are included in revenue. The shipping and handling costs incurred by TJX are included in cost of sales, including buying and occupancy costs.

Consolidated Statements of Income Classifications****: Cost of sales, including buying and occupancy costs, includes the cost of merchandise sold including foreign currency gains and losses on merchandise purchases denominated in other currencies; gains and losses on inventory and fuel-related derivative contracts; asset retirement obligation costs; divisional occupancy costs (including real estate taxes, utility and maintenance costs and fixed asset depreciation); the costs of operating distribution centers; payroll, benefits and travel costs directly associated with buying inventory; and systems costs related to the buying and tracking of inventory.

Selling, general and administrative (“SG&A”) expenses include store payroll and benefit costs; communication costs; credit and check expenses; advertising; administrative and field management payroll, benefits and travel costs; corporate administrative costs and depreciation; gains and losses on non-inventory related foreign currency exchange contracts; and other miscellaneous income and expense items.

Cash and Cash Equivalents: TJX generally considers highly liquid investments with a maturity of 90 days or less at the date of purchase to be cash equivalents. Investments with maturities greater than 90 days but less than one year at the date of purchase are included in short-term investments. These investments are classified as trading securities and are stated at fair value. Investments are classified as either short- or long-term based on their original maturities. TJX’s investments are primarily high-grade commercial paper, institutional money market funds and time deposits with major banks.

As of February 3, 2018, TJX’s cash and cash equivalents held outside the U.S. were $1.8 billion, of which $398.6 million was held in countries where TJX has the intention to reinvest any undistributed earnings indefinitely.

F-9

Merchandise Inventories****: Inventories are stated at the lower of cost or market. TJX uses the retail method for valuing inventories at all of its businesses, except Sierra Trading Post (“STP”), and T.K. Maxx in Australia. The businesses that utilize the retail method have some inventory that is initially valued at cost before the retail method is applied as it has not been fully processed for sale (e.g. inventory in transit and unprocessed inventory in our distribution centers). Under the retail method, TJX utilizes a permanent markdown strategy and lowers the cost value of the inventory that is subject to markdown at the time the retail prices are lowered in the stores. TJX records inventory at the time title transfers, which is typically at the time when inventory is shipped. As a result, merchandise inventories on TJX’s balance sheet include in-transit inventory of $755.4 million at February 3, 2018 and $641.9 million at January 28, 2017. Comparable amounts were reflected in accounts payable at those dates.

Common Stock and Equity: Equity transactions consist primarily of the repurchase by TJX of its common stock under its stock repurchase programs and the recognition of compensation expense and issuance of common stock under TJX’s Stock Incentive Plan. Under TJX’s stock repurchase programs, the Company repurchases its common stock on the open market. The par value of the shares repurchased is charged to common stock with the excess of the purchase price over par first charged against any available additional paid-in capital (“APIC”) and the balance charged to retained earnings. Due to the high volume of repurchases over the past several years, TJX has no remaining balance in APIC at the end of any of the years presented. All shares repurchased have been retired.

Shares issued under TJX’s Stock Incentive Plan are issued from authorized but unissued shares, and proceeds received are recorded by increasing common stock for the par value of the shares with the excess over par added to APIC. Income tax benefits upon the expensing of options result in the creation of a deferred tax asset, while income tax benefits due to the exercise of stock options reduce deferred tax assets up to the amount that an asset for the related grant has been created. Prior to fiscal 2018, any tax benefits greater than the deferred tax assets created at the time of expensing the options were credited to APIC; any deficiencies in the tax benefits were debited to APIC to the extent a pool for such deficiencies existed. In the absence of a pool, any deficiencies were realized in the related periods’ statements of income through the provision for income taxes. Beginning in fiscal 2018, upon adoption of _ASU 2016-09-Compensation-Stock compensation (Topic 718): Improvements to employee share-based payment accountin_g, any excess tax benefits or deficiencies are included in the provision for income taxes. The par value of performance-based restricted stock awards is also added to common stock when the stock is issued, generally at grant date. The fair value of the performance-based restricted stock awards in excess of par value is added to APIC as the awards are amortized into earnings over the related requisite service periods.

Share-Based Compensation: TJX accounts for share-based compensation by estimating the fair value of each award on the date of grant. TJX uses the Black-Scholes option pricing model for options awarded and the market price on the grant date for performance-based restricted stock awards. See Note H – Stock Incentive Plan of Notes to Consolidated Financial Statements for a detailed discussion of share-based compensation.

Interest****: TJX’s interest expense is presented net of capitalized interest and interest income. The following is a summary of interest expense, net:

		Fiscal Year Ended
Dollars in thousands		February 3, 2018				January 28, 2017				January 30, 2016
		(53 weeks)
Interest expense		$	69,237			$	69,219			$	68,253
Capitalized interest			(4,942	)			(7,548	)			(7,984	)
Interest (income)			(32,707	)			(18,137	)			(13,869	)
Interest expense, net		$	31,588			$	43,534			$	46,400

TJX capitalizes interest during the active construction period of major capital projects. Capitalized interest is added to the cost of the related assets. Capitalized interest in fiscal 2018, 2017 and 2016 relates to costs on owned real estate projects and development costs on a merchandising system.

Depreciation and Amortization****: For financial reporting purposes, TJX provides for depreciation and amortization of property using the straight-line method over the estimated useful lives of the assets. Buildings are depreciated over 33 years. Leasehold costs and improvements are generally amortized over their useful life or the committed lease term (typically 10 years), whichever is shorter. Furniture, fixtures and equipment are depreciated over

F-10

3 to 10 years. Depreciation and amortization expense for property was $727.2 million in fiscal 2018, $664.5 million in fiscal 2017 and $622.0 million in fiscal 2016. TJX had no property held under capital leases during fiscal 2018, 2017, or 2016. Maintenance and repairs are charged to expense as incurred. Significant costs incurred for internally developed software are capitalized and amortized over 3 to 15 years. Upon retirement or sale, the cost of disposed assets and the related accumulated depreciation are eliminated and any gain or loss is included in income. Pre-opening costs, including rent, are expensed as incurred.

Lease Accounting****: The Company generally leases stores, distribution centers and office space under operating leases. Store lease agreements generally include rent holidays, rent escalation clauses and contingent rent provisions for percentage of sales in excess of specified levels. We recognize rent on a straight-line basis over the term of the lease, including rent holiday periods and scheduled rent increases. We begin recording rent expense when we take possession of a store, which is typically 30 to 60 days prior to the opening of the store and generally occurs before the commencement of the lease term, as specified in the lease.

Asset Retirement Obligations: The Company establishes an asset retirement obligation, and related asset, for leases of property that require us to return the property to its original condition (commonly referred to as a reinstatement provision) if and when we exit the facility. These reinstatement provisions are primarily applicable to our TJX International locations. The income statement impact of our asset retirement obligation is recorded in general corporate expenses and our operating divisions are charged the actual costs incurred when a retirement takes place.

Build to Suit Accounting: Lease agreements involving property built to our specifications are reviewed to determine if our involvement in the construction project requires that we account for the project costs as if we were the owner for accounting purposes. We have entered into several lease agreements where we are deemed the owner of a construction project for accounting purposes. Thus, during construction of the facility the construction costs incurred by the lessor are included as a construction in progress asset along with a related liability of the same amount on our balance sheet. Upon completion of the project, a sale-leaseback analysis is performed to determine if the Company should record a sale to remove the related asset and related obligation and record the lease as either an operating or capital lease obligation. If the Company is precluded from derecognizing the asset when construction is complete, due to continuing involvement beyond a normal leaseback, the lease is accounted for as a financing transaction and the recorded asset and related financing obligation remain on the Consolidated Balance Sheets. Accordingly, the asset is depreciated over its estimated useful life in accordance with the Company’s policy and a portion of the lease payments is allocated to ground rent and treated as an operating lease. The portion of the lease payment allocated to ground rental expense is based on the fair value of the land at the commencement of construction. Lease payments allocated to the non-land asset are recognized as reductions to the financing obligation and interest expense.

Goodwill and Tradenames****: Goodwill includes the excess of the purchase price paid over the carrying value of the minority interest acquired in fiscal 1990 in TJX’s former 83%-owned subsidiary and represents goodwill associated with the T.J. Maxx chain, as well as the excess of cost over the estimated fair market value of the net assets acquired by TJX in the purchase of Winners in fiscal 1991, the purchase of STP in fiscal 2013, and the purchase of Trade Secret in fiscal 2016, which was re-branded under the T.K. Maxx name during fiscal 2018. The following is a roll forward of goodwill by component:

Amounts in thousands		Marmaxx				Winners				Sierra Trading Post				T.K. Maxx in Australia				Total
Balance, January 31, 2015		$	70,027			$	1,741				$97,254			$	—			$	169,022
Additions			—				—				—				25,233				25,233
Effect of exchange rate changes on goodwill			—				(154	)			—				(190	)			(344	)
Balance, January 30, 2016			70,027				1,587				97,254				25,043				193,911
Effect of exchange rate changes on goodwill			—				99				—				1,861				1,960
Balance, January 28, 2017			70,027				1,686				97,254				26,904				195,871
Impairment			—				—				(97,254	)			—				(97,254	)
Effect of exchange rate changes on goodwill			—				98				—				1,354				1,452
Balance, February 3, 2018		$	70,027			$	1,784			$	—			$	28,258			$	100,069

F-11

Goodwill is considered to have an indefinite life and accordingly is not amortized.

In fiscal 2018, the Company recorded an impairment charge of $99.3 million which included $97.3 million of STP goodwill and $2.0 million for certain long-lived assets of STP as the estimated fair value of this business fell below the carrying value due to a decrease in projected revenue growth rates. The impairment charge is included within the Marmaxx segment results.

Tradenames, which are included in other assets, are the value assigned to the name “Marshalls,” acquired by TJX in fiscal 1996 as part of the acquisition of the Marshalls chain, the value assigned to the name “Sierra Trading Post,” acquired by TJX in fiscal 2013 and the value assigned to the name “Trade Secret,” acquired by TJX in fiscal 2016. The tradenames were valued by calculating the discounted present value of assumed after-tax royalty payments. The Marshalls tradename is carried at a value of $107.7 million and is considered to have an indefinite life. The Sierra Trading Post tradename is being amortized over 15 years and was carried at a value of $25.5 million in fiscal 2018, $28.0 million in fiscal 2017 and $30.6 million in fiscal 2016 net of amortization of $13.0 million, $10.5 million and $7.9 million in fiscal 2018, fiscal 2017 and fiscal 2016, respectively. The Trade Secret tradename is being amortized over 7 years and was carried at a value of $11.7 million in fiscal 2018, $11.0 million in fiscal 2017 and $11.6 million in fiscal 2016, which included a positive impact from foreign exchange of $2.1 million in fiscal 2018, $640,000 in fiscal 2017 and a negative impact from foreign exchange of $90,000 in 2016. The carrying value is also net of amortization of $2.9 million, $1.6 million and $300,000 in fiscal 2018, 2017 and 2016, respectively.

TJX occasionally acquires or licenses other trademarks to be used in connection with private label merchandise. Such trademarks are included in other assets and are amortized to cost of sales, including buying and occupancy costs, over their useful life, generally from 7 to 10 years.

Goodwill, tradenames and trademarks, and the related accumulated amortization or impairment if any, are included in the respective operating segment to which they relate.

Impairment of Long-Lived Assets, Goodwill and Tradenames****: TJX evaluates its long-lived assets, goodwill and tradenames for indicators of impairment at least annually in the fourth quarter of each fiscal year or whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable.

The evaluation for long-lived assets including tradenames that are amortized, is performed at the lowest level of identifiable cash flows which are largely independent of other groups of assets, generally at the individual store level for fixed assets and the reporting unit for tradenames that are amortized. If indicators of impairment are identified, an undiscounted cash flow analysis is performed to determine if the carrying value of the asset or asset group is recoverable. If the cash flow is less than the carrying value then an impairment charge will be recorded to the extent the fair value of an asset or asset group is less than the carrying value of that asset or asset group. During fiscal 2018, this analysis resulted in immaterial impairment charges of store fixed assets. The store-by-store evaluations did not indicate any recoverability issues in fiscal 2017 and 2016.

Goodwill and tradenames with an indefinite life are tested for impairment whenever events or changes in circumstances indicate that an impairment may have occurred and at least annually in the fourth quarter of each fiscal year. The carrying value of tradenames with an indefinite life is compared to its fair value determined by calculating the discounted present value of assumed after-tax royalty payments to the carrying value of the tradename. There was no impairment related to tradenames in fiscal 2018, 2017 or 2016. Goodwill is tested for impairment by using a quantitative assessment by comparing the carrying value of the related reporting unit to its fair value. An impairment exists when this analysis, using typical valuation models such as the discounted cash flow method, shows that the fair value of the reporting unit is less than the carrying cost of the reporting unit. We may assess qualitative factors to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. The assessment of qualitative factors is optional and at the Company’s discretion. In fiscal 2018 and fiscal 2017, we bypassed the qualitative assessment and performed the first step of the quantitative goodwill impairment test. In fiscal 2018 the Company recorded an impairment charge of $97.3 million for STP goodwill as the estimated fair value of this business fell below the carrying value due to a decrease in projected revenue growth rates. There were no impairments related to our goodwill in fiscal 2017 or 2016.

Advertising Costs****: TJX expenses advertising costs as incurred. Advertising expense was $412.4 million for fiscal 2018, $402.6 million for fiscal 2017 and $382.9 million for fiscal 2016.

F-12

Foreign Currency Translation****: TJX’s foreign assets and liabilities are translated into U.S. dollars at fiscal year-end exchange rates with resulting translation gains and losses included in shareholders’ equity as a component of accumulated other comprehensive income (loss). Activity of the foreign operations that affect the statements of income and cash flows is translated at average exchange rates prevailing during the fiscal year.

Loss Contingencies: TJX records a reserve for loss contingencies when it is both probable that a loss will be incurred and the amount of the loss is reasonably estimable. TJX evaluates pending litigation and other contingencies at least quarterly and adjusts the reserve for such contingencies for changes in probable and reasonably estimable losses. TJX includes an estimate for related legal costs at the time such costs are both probable and reasonably estimable.

Future Adoption of New Accounting Standards

Revenue Recognition

In May 2014, the Financial Accounting Standards Board (the “FASB”) issued updated guidance on revenue recognition. The new guidance supersedes most preexisting revenue recognition guidance. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard is effective for annual reporting periods beginning after December 15, 2017. We will adopt the new revenue recognition guidance on February 4, 2018 under the modified retrospective approach, which will result in immaterial cumulative adjustment to retained earnings. The cumulative adjustment will primarily relate to revenue recognized on the value of unredeemed rewards certificates issued to customers as part of the Company’s cobranded credit card rewards program as we will recognize the estimated unredeemed awards when they are earned, rather than when merchandise credits expire or the likelihood of redemption becomes remote. Other changes that have been identified relate to the presentation of revenue whereby outside cobranded credit card expenses will be classified as SG&A rather than as a reduction of revenue. The new standard will require a change in the presentation of our sales return reserve on the balance sheet, which we currently record net of the value of returned merchandise. The new standard will require the reserve be established at the gross sales value with an asset established for the value of the merchandise returned. We believe that there will be no change in the timing or amount of revenue recognized under the new standard as it relates to revenue from point of sale at the registers in our stores, which constitutes more than 95% of our revenue. Overall we do not expect these changes to have a material impact on our financial condition or results of operations other than additional disclosure requirements.

Leases

In February 2016, the FASB issued updated guidance on leases that aims to increase transparency and comparability among organizations by requiring lessees to recognize lease assets and lease liabilities on the balance sheet and requiring disclosure of key information about leasing arrangements. The new standard is effective for annual periods beginning after December 15, 2018, and interim periods within those annual periods; early adoption is permitted and modified retrospective application is required. We plan to adopt this standard in the first quarter of the fiscal year ending February 1, 2020. The Company is in the process of implementing a new lease accounting system and has established a cross-functional team to implement the updated lease guidance and who are in the process of evaluating our lease portfolio and the impact this standard will have on our Consolidated Financial Statements and Notes thereto. The Company expects this standard to have a material impact on its statement of financial condition as it will record a significant asset and liability associated with its more than 4,000 leased locations. We plan to take the transition package of three practical expedients permitted within the standard, which among other things, allows the carryforward of historical lease classifications. We expect to make an accounting policy election that will keep leases with a term of 12 months or less off the balance sheet and result in recognizing those lease payments on a straight-line basis over the lease term. As our leases do not provide an implicit rate, we plan to use our incremental borrowing rate based on information available at commencement date in the determining the present value of future payments. The Company has determined that the initial lease term will not differ under the new standard versus current accounting practice, and therefore the income statement impact of the new standard is not expected to be material.

F-13

Cash Flows

In August 2016, the FASB issued a pronouncement that addresses diversity in how certain cash receipts and cash payments are presented in the statement of cash flows. The new guidance provides clarity around the cash flow classification for eight specific issues in an effort to reduce the current and potential future diversity in practice. The standard, which is to be applied retrospectively, will be effective for the first interim period within annual reporting periods beginning after December 15, 2017, and early adoption is permitted. We plan to adopt this standard in the first quarter of the fiscal year ending February 2, 2019 and we do not expect there to be a material impact on our consolidated financial statements.

Retirement Benefits

In March 2017, the FASB issued updated guidance related to retirement benefits, which requires that an employer report the service cost component of net periodic pension and net periodic post retirement cost in the same line item as other compensation costs arising from services rendered by the employees during the period. It also requires the other components of net periodic pension and net periodic postretirement benefit cost to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations if such a subtotal is typically presented. We do not include such a subtotal on our income statement so we intend to record the non-service components of pension cost in our SG&A expenses and present appropriate disclosures. Additionally, only the service cost component is eligible for capitalization. This pronouncement is effective for annual periods beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted as of the beginning of an annual period for which financial statements have not been issued or made available for issuance. The amendments in this update are to be applied retrospectively for the presentation of the service cost component and the other components of net periodic pension cost as well as net periodic postretirement benefit cost in the income statement and prospectively, on and after the effective date, for the capitalization of the service cost component of net periodic pension cost and net periodic postretirement benefit in assets. We plan to adopt this standard in the first quarter of the fiscal year ending February 2, 2019. We do not expect there to be a material impact on our consolidated financial statements.

Hedging Activities

In August 2017, the FASB issued updated guidance on hedge accounting. The updates allow hedge accounting for new types of interest rate hedges of financial instruments and simplify documentation requirements to qualify for hedge accounting. In addition, any gain or loss from hedge ineffectiveness will be reported in the same income statement line with the effective hedge results and the hedged transaction. The updated guidance is effective for annual reporting periods beginning after December 15, 2018, and early adoption is permitted. The Company has not yet determined the timing for adoption or estimated the effect on the Company’s financial statements.

Income Statement – Reporting Comprehensive Income

In February 2018, the FASB issued updated guidance related to reporting comprehensive income. The amendments in the update allow for a one-time reclassification from accumulated other comprehensive income (“AOCI”) to retained earnings for stranded tax effect as a result from the enactment of the Tax Cuts and Jobs Act of 2017 (“2017 Tax Act”). The updated guidance is effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted, including adoption in any interim period for reporting periods for which financial statements have not yet been issued. The updated guidance should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the 2017 Tax Act is recognized. The Company has not yet determined the timing of adoption or estimated the effect on the Company’s financial statements.

Recently Adopted Accounting Standards

Goodwill

In the fourth quarter of fiscal 2018, TJX early adopted a pronouncement that simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. Under the new guidance, goodwill

F-14

impairment is to be measured as the amount by which the carrying value exceeds the fair value of the reporting unit. The loss recognized should not exceed the total amount of goodwill allocated to the reporting unit.

Share Based Compensation

In the first quarter of fiscal 2018, TJX adopted a pronouncement that aims to simplify several aspects of accounting and reporting for share-based payment transactions. One provision within this pronouncement requires that excess income tax benefits and tax deficiencies related to share-based payments be recognized within income tax expense in the statement of income, rather than within additional paid-in capital on the balance sheet. The adoption of this provision has been applied prospectively. The impact to TJX’s results of operations related to the adoption of this standard was a decrease in the provision for income taxes of $51.5 million for the fiscal year ended February 3, 2018. The impact of this benefit on TJX’s future results of operations will depend in part on the market prices for TJX’s shares on the dates there are taxable events related to share awards, and therefore the impact is difficult to predict. In addition, this pronouncement requires the cash paid to a taxing authority when shares are withheld to pay employee taxes to be classified as a “financing activity” rather than an “operating activity,” as previously classified on the Statement of Cash Flows. This reclassification was made on a retrospective basis. This provisions within the pronouncement did not have a material impact on our consolidated financial statements.

Note B. Property at Cost

Presented below are the components of property at cost:

		Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017
Land and buildings		$	1,355,777			$	1,247,585
Leasehold costs and improvements			3,254,830				2,884,054
Furniture, fixtures and equipment			5,357,701				4,871,764
Total property at cost		$	9,968,308			$	9,003,403
Less accumulated depreciation and amortization			4,962,255				4,470,509
Net property at cost		$	5,006,053			$	4,532,894

Presented below is information related to carrying values of TJX’s long-lived assets by geographic location:

		Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017
United States		$	3,514,628			$	3,312,210
Canada			308,259				283,688
Europe			1,151,972				920,710
Australia			31,194				16,286
Total long-lived assets		$	5,006,053			$	4,532,894

F-15

Note C. Accumulated Other Comprehensive Income (Loss)

Amounts included in accumulated other comprehensive income (loss) relate to the Company’s foreign currency translation adjustments, deferred gains/losses on pension and other post-retirement obligations and a cash flow hedge on issued debt, all of which are recorded net of the related income tax effects. The following table details the changes in accumulated other comprehensive income (loss) for fiscal 2018, fiscal 2017 and fiscal 2016:

Amounts in thousands		Foreign Currency Translation				Deferred Benefit Costs				Cash Flow Hedge on Debt				Accumulated Other Comprehensive Income (Loss)
Balance, January 31, 2015		$	(295,269	)		$	(254,806	)		$	(4,310	)		$	(554,385	)
Foreign currency translation adjustments (net of taxes of $41,048)			(143,923	)			—				—				(143,923	)
Recognition of net gains/losses on benefit obligations (net of taxes of $6,335)			—				9,629				—				9,629
Amortization of loss on cash flow hedge (net of taxes of $450)			—				—				684				684
Amortization of prior service cost and deferred gains/losses (net of taxes of $13,501)			—				20,523				—				20,523
Balance, January 30, 2016			(439,192	)			(224,654	)			(3,626	)			(667,472	)
Foreign currency translation adjustments (net of taxes of $25,656)			(52,611	)			—				—				(52,611	)
Recognition of net gains/losses on benefit obligations (net of taxes of $7,394)			—				(11,239	)			—				(11,239	)
Pension settlement charge (net of taxes of $12,369)			—				18,804				—				18,804
Amortization of loss on cash flow hedge (net of taxes of $450)			—				—				684				684
Amortization of prior service cost and deferred gains/losses (net of taxes of $11,584)			—				17,608				—				17,608
Balance, January 28, 2017			(491,803	)			(199,481	)			(2,942	)			(694,226	)
Foreign currency translation adjustments (net of taxes of $36,929)			211,752				—				—				211,752
Recognition of net gains/losses on benefit obligations (net of taxes of $8,989)			—				24,691				—				24,691
Amortization of loss on cash flow hedge (net of taxes of $438)			—				—				696				696
Amortization of prior service cost and deferred gains/losses (net of taxes of $9,592)			—				15,228				—				15,228
Balance, February 3, 2018		$	(280,051	)		$	(159,562	)		$	(2,246	)		$	(441,859	)

Note D. Capital Stock and Earnings Per Share

Capital Stock: TJX repurchased and retired 22.3 million shares of its common stock at a cost of $1.7 billion during fiscal 2018, on a “trade date basis.” TJX reflects stock repurchases in its financial statements on a “settlement date” or cash basis. TJX had cash expenditures under repurchase programs of $1.6 billion in fiscal 2018, $1.7 billion in fiscal 2017 and $1.8 billion in fiscal 2016, and repurchased 22.2 million shares in fiscal 2018, 22.3 million shares in fiscal 2017 and 26.6 million shares in fiscal 2016. These expenditures were funded primarily by cash generated from operations.

As of February 3, 2018 TJX had $1.1 billion available under previously announced stock repurchase programs. In February 2018, TJX announced that its Board of Directors had approved the repurchase of an additional $3.0 billion of TJX common stock from time to time.

All shares repurchased under the stock repurchase programs have been retired.

TJX has five million shares of authorized but unissued preferred stock, $1 par value.

F-16

Earnings Per Share: The following table presents the calculation of basic and diluted earnings per share for net income:

		Fiscal Year Ended
Amounts in thousands except per share amounts		February 3, 2018				January 28, 2017				January 30, 2016
		(53 weeks)
Basic earnings per share:
Net income		$	2,607,948			$	2,298,234			$	2,277,658
Weighted average common stock outstanding for basic earnings per share calculation			636,827				655,647				673,484
Basic earnings per share		$	4.10			$	3.51			$	3.38
Diluted earnings per share:
Net income		$	2,607,948			$	2,298,234			$	2,277,658
Weighted average common stock outstanding for basic earnings per share calculation			636,827				655,647				673,484
Assumed exercise / vesting of:
Stock options and awards			9,278				8,785				9,767
Weighted average common stock outstanding for diluted earnings per share calculation			646,105				664,432				683,251
Diluted earnings per share		$	4.04			$	3.46			$	3.33

The weighted average common shares for the diluted earnings per share calculation exclude the impact of outstanding stock options if the assumed proceeds per share of the option is in excess of the average price of TJX’s common stock for the related fiscal periods. Such options are excluded because they would have an antidilutive effect. There were 12.5 million, 8.1 million and 4.1 million such options excluded at the end of fiscal 2018, fiscal 2017 and fiscal 2016, respectively.

Note E. Financial Instruments

As a result of its operating and financing activities, TJX is exposed to market risks from changes in interest and foreign currency exchange rates as well as changes in fuel costs. These market risks may adversely affect TJX’s operating results and financial position. TJX seeks to minimize risk from changes in interest rates, foreign currency exchange rates and fuel costs through the use of derivative financial instruments when and to the extent we deem appropriate. TJX does not use derivative financial instruments for trading or other speculative purposes and does not use any leveraged derivative financial instruments. TJX recognizes all derivative instruments as either assets or liabilities in the statements of financial position and measures those instruments at fair value. The fair values of the derivatives are classified as assets or liabilities, current or non-current, based upon valuation results and settlement dates of the individual contracts. Changes to the fair value of derivative contracts that do not qualify for hedge accounting are reported in earnings in the period of the change. For derivatives that qualify for hedge accounting, changes in the fair value of the derivatives are either recorded in shareholders’ equity as a component of other comprehensive income or are recognized currently in earnings, along with an offsetting adjustment against the basis of the item being hedged. TJX periodically reviews its net investments in foreign subsidiaries and did not enter into hedges for such investments during fiscal 2018.

Diesel Fuel Contracts: TJX hedges portions of its estimated notional diesel requirements based on the diesel fuel expected to be consumed by independent freight carriers transporting TJX’s inventory. Independent freight carriers transporting TJX’s inventory charge TJX a mileage surcharge based on the price of diesel fuel. The hedge agreements are designed to mitigate the volatility of diesel fuel pricing (and the resulting per mile surcharges payable by TJX) by setting a fixed price per gallon for the period being hedged. During fiscal 2018, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for fiscal 2019. The hedge agreements outstanding at February 3, 2018 relate to approximately 50% of TJX’s estimated notional diesel requirements for fiscal 2019. These diesel fuel hedge agreements will settle throughout fiscal 2019 and the first month of fiscal 2020. TJX elected not to apply hedge accounting rules to these contracts.

F-17

Foreign Currency Contracts: TJX enters into forward foreign currency exchange contracts to obtain economic hedges on portions of merchandise purchases made and anticipated to be made by the Company’s operations in TJX International (United Kingdom, Ireland, Germany, Poland, Austria, the Netherlands and Australia), TJX Canada (Canada), Marmaxx (U.S.) and HomeGoods (U.S.) in currencies other than their respective functional currencies. These contracts typically have a term of twelve months or less. The contracts outstanding at February 3, 2018 cover a portion of such actual and anticipated merchandise purchases throughout fiscal 2019. Additionally, TJX’s operations in Europe are subject to foreign currency exposure as a result of their buying function being centralized in the United Kingdom. All merchandise is purchased centrally in the U.K. and then shipped and billed to the retail entities in other countries. This intercompany billing to TJX’s European businesses’ Euro denominated operations creates exposure to the buying entity for changes in the exchange rate between the Euro and British Pound. The inflow of Euros to the central buying entity provides a natural hedge for merchandise purchased from third-party vendors that is denominated in Euros. However, with the growth of TJX’s Euro denominated retail operations, the intercompany billings committed to the Euro denominated operations is generating Euros in excess of those needed to meet merchandise commitments to outside vendors. TJX calculates this excess Euro exposure each month and enters into forward contracts of approximately 30 days duration to mitigate the exposure. TJX elected not to apply hedge accounting rules to these contracts.

TJX also enters into derivative contracts, generally designated as fair value hedges, to hedge intercompany debt and intercompany interest payable. The changes in fair value of these contracts are recorded in selling, general and administrative expenses and are offset by marking the underlying item to fair value in the same period. Upon settlement, the realized gains and losses on these contracts are offset by the realized gains and losses of the underlying item in selling, general and administrative expenses.

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at February 3, 2018:

In thousands		Pay				Receive				Blended Contract Rate				Balance Sheet Location				Current Asset U.S.$				Current (Liability) U.S.$				Net Fair Value in U.S.$ at February 3, 2018
Fair value hedges:
Intercompany balances, primarily debt and related interest
			zł 67,000				£ 14,035				0.2095				(Accrued Exp)			$	—			$	(45	)		$	(45	)
			€ 51,950				£ 46,095				0.8873				(Accrued Exp)				—				(318	)			(318	)
			U.S.$ 77,079				£ 55,000				0.7136				Prepaid Exp				1,636				—				1,636
Economic hedges for which hedge accounting was not elected:
Diesel contracts			Fixed on 2.2M – 3.0M gal per month				Float on 2.2M – 3.0M gal per month				N/A				Prepaid Exp				7,854				—				7,854
Intercompany billings in TJX Europe, primarily merchandise related
			€ 26,000				£ 22,948				0.8826				(Accrued Exp	)			—				(2	)			(2	)
Merchandise purchase commitments
			C$ 462,464				U.S.$ 367,200				0.7940				Prepaid Exp / (Accrued Exp)				49				(5,478	)			(5,429	)
			C$ 22,562				€ 15,000				0.6648				Prepaid Exp				557				—				557
			£ 176,911				U.S.$ 238,000				1.3453				Prepaid Exp / (Accrued Exp)				173				(12,838	)			(12,665	)
			zł 288,646				£ 60,023				0.2079				(Accrued Exp)				—				(1,303	)			(1,303	)
			A$ 28,635				U.S.$ 22,230				0.7763				Prepaid Exp / (Accrued Exp)				43				(573	)			(530	)
			U.S.$ 44,223				€ 36,950				0.8355				Prepaid Exp				1,905				—				1,905
Total fair value of financial instruments																		$	12,217			$	(20,557	)		$	(8,340	)

F-18

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at January 28, 2017:

In thousands		Pay				Receive				Blended Contract Rate				Balance Sheet Location				Current Asset U.S.$				Current (Liability) U.S.$				Net Fair Value in U.S.$ at January 28, 2017
Fair value hedges:
Intercompany balances, primarily debt and related interest
			zł 67,000				£ 13,000				0.1940				(Accrued Exp)			$	—			$	(6	)		$	(6	)
			€ 63,000				£ 54,452				0.8643				Prepaid Exp				263				—				263
			U.S.$ 68,445				£ 55,000				0.8036				Prepaid Exp				1,196				—				1,196
Economic hedges for which hedge accounting was not elected:
Diesel contracts			Fixed on 2.1M – 2.5M gal per month				Float on 2.1M – 2.5M gal per month				N/A				Prepaid Exp				2,183				—				2,183
Intercompany billings in Europe, primarily merchandise related
			€ 68,000				£ 58,306				0.8574				Prepaid Exp				262				—				262
Merchandise purchase commitments
			C$ 462,025				U.S.$ 349,750				0.7570				Prepaid Exp / (Accrued Exp)				1,089				(3,081	)			(1,992	)
			C$ 19,571				€ 13,650				0.6975				Prepaid Exp / (Accrued Exp)				22				(290	)			(268	)
			£ 180,963				U.S.$ 227,500				1.2572				Prepaid Exp / (Accrued Exp)				2,327				(2,695	)			(368	)
			zł 249,079				£ 48,593				0.1951				Prepaid Exp / (Accrued Exp)				681				(927	)			(246	)
			U.S.$ 22,226				€ 20,686				0.9307				Prepaid Exp / (Accrued Exp)				178				(257	)			(79	)
Total fair value of financial instruments																		$	8,201			$	(7,256	)		$	945

The impact of derivative financial instruments on the statements of income during fiscal 2018, fiscal 2017 and fiscal 2016 are as follows:

				Amount of Gain (Loss) Recognized in Income by Derivative
In thousands		Location of Gain (Loss) Recognized in Income by Derivative		February 3, 2018				January 28, 2017				January 30, 2016
				(53 weeks)
Fair value hedges:
Intercompany balances, primarily debt and related interest		Selling, general and administrative expenses		$	1,207			$	(17,250	)		$	(3,927	)
Economic hedges for which hedge accounting was not elected:
Diesel contracts		Cost of sales, including buying and occupancy costs			7,946				3,906				(21,797	)
Intercompany billings in Europe, primarily merchandise related		Cost of sales, including buying and occupancy costs			(3,042	)			(8,684	)			(5,768	)
Merchandise purchase commitments		Cost of sales, including buying and occupancy costs			(45,886	)			5,626				49,107
(Loss) gain recognized in income				$	(39,775	)		$	(16,402	)		$	17,615

F-19

Included in the table above are realized losses of $30.5 million in fiscal 2018 and $6.1 million in fiscal 2017, and a gain of $28.5 million in fiscal 2016, all of which were largely offset by gains and losses on the underlying hedged item.

Note F. Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date or “exit price.” The inputs used to measure fair value are generally classified into the following hierarchy:

Level 1:		Unadjusted quoted prices in active markets for identical assets or liabilities
Level 2:		Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability
Level 3:		Unobservable inputs for the asset or liability

The following table sets forth TJX’s financial assets and liabilities that are accounted for at fair value on a recurring basis:

		Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017				January 30, 2016
Level 1
Assets:
Executive Savings Plan investments		$	249,045			$	195,733			$	155,847
Level 2
Assets:
Short-term investments		$	506,165			$	543,242			$	352,313
Foreign currency exchange contracts			4,363				6,018				28,643
Diesel fuel contracts			7,854				2,183				—
Liabilities:
Foreign currency exchange contracts		$	20,557			$	7,256			$	3,455
Diesel fuel contracts			—				—				13,952

Investments designed to meet obligations under the Executive Savings Plan are invested in registered investment companies traded in active markets and are recorded at unadjusted quoted prices.

Short-term investments, foreign currency exchange contracts and diesel fuel contracts are valued using broker quotations, which include observable market information. TJX’s investments are primarily high-grade commercial paper, institutional money market funds and time deposits with major banks. TJX does not make adjustments to quotes or prices obtained from brokers or pricing services but does assess the credit risk of counterparties and will adjust final valuations when appropriate. Where independent pricing services provide fair values, TJX obtains an understanding of the methods used in pricing. As such, these instruments are classified within Level 2.

The fair value of TJX’s general corporate debt was estimated by obtaining market quotes given the trading levels of other bonds of the same general issuer type and market perceived credit quality. These inputs are considered to be Level 2. The fair value of long-term debt at February 3, 2018 was $2.16 billion compared to a carrying value of $2.23 billion. The fair value of long-term debt at January 28, 2017 was $2.17 billion compared to a carrying value of $2.23 billion. The fair value of long-term debt at January 30, 2016 was $1.70 billion compared to a carrying value of $1.62 billion. These estimates do not necessarily reflect provisions or restrictions in the various debt agreements that might affect TJX’s ability to settle these obligations.

TJX’s cash equivalents are stated at cost, which approximates fair value due to the short maturities of these instruments.

Note G. Segment Information

TJX operates four main business segments. The Marmaxx segment (T.J. Maxx, Marshalls and tjmaxx.com) and the HomeGoods segment (HomeGoods and Homesense) both operate in the United States, the TJX Canada segment operates Winners, HomeSense and Marshalls in Canada, and the TJX International segment operates T.K.

F-20

Maxx, Homesense and tkmaxx.com in Europe and T.K. Maxx in Australia. TJX also operates STP, an off-price Internet retailer that operates sierratradingpost.com and retail stores in the U.S. The results of STP are included in the Marmaxx segment.

All of TJX’s stores, with the exception of HomeGoods and HomeSense, sell family apparel and home fashions. HomeGoods and HomeSense offer home fashions.

The percentages of our consolidated revenues by major product category for the last three fiscal years are as follows:

		Fiscal 2018				Fiscal 2017				Fiscal 2016
Apparel
Clothing including footwear			52	%			54	%			55	%
Jewelry and accessories			15				15				15
Home fashions			33				31				30
Total			100	%			100	%			100	%

For fiscal 2018, TJX Canada and TJX International accounted for 24% of TJX’s net sales, 18% of segment profit and 27% of consolidated assets. For fiscal 2017, TJX Canada and TJX International accounted for 23% of TJX’s net sales, 15% of segment profit and 24% of consolidated assets. For fiscal 2016, TJX Canada and TJX International accounted for 23% of TJX’s net sales, 17% of segment profit and 23% of consolidated assets.

TJX evaluates the performance of its segments based on “segment profit or loss,” which it defines as pre-tax income or loss before general corporate expense, loss on early extinguishment of debt, pension settlement charge and interest expense, net. “Segment profit or loss,” as defined by TJX, may not be comparable to similarly titled measures used by other entities. These measures of performance should not be considered alternatives to net income or cash flows from operating activities as an indicator of TJX’s performance or as a measure of liquidity.

Presented below is financial information with respect to TJX’s business segments:

		Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017				January 30, 2016
		(53 weeks)
Net sales:
In the United States
Marmaxx		$	22,249,105			$	21,246,034			$	19,948,227
HomeGoods			5,116,328				4,404,607				3,915,221
TJX Canada			3,642,282				3,171,127				2,854,617
TJX International			4,856,949				4,361,976				4,226,873
		$	35,864,664			$	33,183,744			$	30,944,938
Segment profit:
In the United States
Marmaxx(1)		$	2,949,358			$	2,995,045			$	2,858,780
HomeGoods			674,511				613,778				549,318
TJX Canada			530,113				413,417				375,306
TJX International			249,226				235,519				316,939
			4,403,208				4,257,759				4,100,343
General corporate expense			515,032				408,236				395,643
Loss on early extinguishment of debt			—				51,773				—
Pension settlement charge			—				31,173				—
Interest expense, net			31,588				43,534				46,400
Income before provision for income taxes		$	3,856,588			$	3,723,043			$	3,658,300

F-21

Business segment information (continued):

		Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017				January 30, 2016
Identifiable assets:
In the United States
Marmaxx		$	5,676,464			$	5,440,448			$	5,526,570
HomeGoods			1,237,811				1,086,947				915,549
TJX Canada			1,459,924				1,345,003				1,021,584
TJX International			2,321,001				1,789,140				1,645,296
Corporate(2)			3,362,815				3,222,270				2,381,432
		$	14,058,015			$	12,883,808			$	11,490,431
Capital expenditures:
In the United States
Marmaxx		$	532,348			$	449,169			$	442,910
HomeGoods			149,505				173,979				130,593
TJX Canada			88,761				100,437				71,071
TJX International			287,003				301,162				244,806
		$	1,057,617			$	1,024,747			$	889,380
Depreciation and amortization:
In the United States
Marmaxx		$	399,014			$	385,007			$	364,892
HomeGoods			94,709				77,287				67,204
TJX Canada			68,033				62,427				54,573
TJX International			159,010				129,376				126,020
Corporate(3)			5,191				4,699				4,007
		$	725,957			$	658,796			$	616,696

(1)	Fiscal 2018 amount includes an impairment charge of $99.3 million for goodwill and certain long-lived assets of STP.

(2)	Corporate identifiable assets consist primarily of cash, receivables, prepaid insurance, prepaid service contracts and the trust assets in connection with the Executive Savings Plan. Consolidated cash, including cash held in our foreign entities, is included with corporate assets for consistency with the reporting of cash for our segments in the U.S.

(3)	Includes debt discount accretion and debt expense amortization.

Note H. Stock Incentive Plan

TJX has a Stock Incentive Plan under which options and other share-based awards may be granted to its directors, officers and key employees. This plan has been approved by TJX’s shareholders, and all share-based compensation awards are made under this plan. The Stock Incentive Plan, as amended with shareholder approval, has provided for the issuance of up to 347.8 million shares with 26.6 million shares available for future grants as of February 3, 2018. TJX issues shares under the plan from authorized but unissued common stock.

Total compensation cost related to share-based compensation was $101.4 million, $102.3 million and $94.1 million in fiscal 2018, 2017 and 2016, respectively. As of February 3, 2018, there was $130.7 million of total unrecognized compensation cost related to nonvested share-based compensation arrangements granted under the plan. That cost is expected to be recognized over a weighted-average period of two years.

Options for the purchase of common stock are granted with an exercise price that is 100% of market price on the grant date, generally vest in thirds over a three-year period starting one year after the grant, and have a ten-year maximum term. When options are granted with other vesting terms, the vesting information is reflected in the valuation.

F-22

The fair value of options is estimated as of the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions:

		Fiscal Year Ended
		February 3, 2018				January 28, 2017				January 30, 2016
Risk-free interest rate			1.75	%			1.20	%			1.50	%
Dividend yield			1.5	%			1.2	%			1.2	%
Expected volatility factor			23.5	%			23.8	%			24.4	%
Expected option life in years			4.8				4.8				4.5
Weighted average fair value of options issued		$	14.32			$	14.55			$	14.48

The risk-free interest rate is for periods within the contractual life of the option based on the U.S. Treasury yield curve in effect at the time of grant. We use historical data to estimate option exercises, employee termination behavior and dividend yield within the valuation model. Expected volatility is based on a combination of implied volatility from traded options on our stock, and historical volatility during a term approximating the expected life of the option granted. The expected option life represents an estimate of the period of time options are expected to remain outstanding based upon historical exercise trends. Employee groups and option characteristics are considered separately for valuation purposes when applicable.

Stock Options: A summary of the status of TJX’s stock options and related weighted average exercise prices (“WAEP”) is presented below (shares in thousands):

		Fiscal Year Ended
		February 3, 2018								January 28, 2017								January 30, 2016
		Options				WAEP				Options				WAEP				Options				WAEP
			(53 weeks)
Outstanding at beginning of year			27,353			$	48.69				28,686			$	41.68				30,078			$	34.91
Granted			4,702				73.21				4,305				75.04				4,169				72.54
Exercised			(4,096	)			32.23				(5,265	)			30.83				(5,124	)			25.87
Forfeitures			(329	)			71.40				(373	)			66.15				(437	)			55.06
Outstanding at end of year			27,630			$	55.03				27,353			$	48.69				28,686			$	41.68
Options exercisable at end of year			18,976			$	46.56				18,980			$	38.69				20,175			$	31.75

The total intrinsic value of options exercised was $176.7 million in fiscal 2018, $239.7 million in fiscal 2017 and $227.4 million in fiscal 2016.

The following table summarizes information about stock options outstanding that were expected to vest and stock options outstanding that were exercisable as of February 3, 2018:

Shares in thousands		Shares				Aggregate Intrinsic Value				Weighted Average Remaining Contract Life				WAEP
Options outstanding expected to vest			8,014			$	38,245				9.0 years			$	73.70
Options exercisable			18,976			$	605,624				5.0 years			$	46.56
Total outstanding options vested and expected to vest			26,990			$	643,869				6.2 years			$	54.61

Options outstanding expected to vest represents total unvested options of 8.6 million adjusted for anticipated forfeitures.

Performance-Based Stock Awards: TJX granted performance-based restricted stock, performance-based restricted stock units and performance-based deferred stock awards (collectively referred to as performance-based stock awards) under the Stock Incentive Plan during fiscal 2018. These awards were granted without a purchase price to the recipient and are subject to vesting conditions, including specified performance criteria aligned with management incentive plans for a period of generally one to three years. The grant date fair value of the performance-based stock awards is charged to income over the requisite service period during which the recipient must remain employed. The fair value of the performance-based stock awards is determined at date of grant in accordance with ASC Topic 718 and assumes that performance goals will be achieved. If such goals are not met, or only partially met, awards and related compensation costs recognized are reduced on a pro rata basis.

F-23

A summary of the status of our nonvested performance-based stock awards and changes during fiscal 2018 is presented below:

Shares in thousands		Performance- based stock awards				Weighted Average Grant Date Fair Value
Nonvested at beginning of year			1,559			$	72.52
Granted			562				76.71
Vested			(551	)			63.77
Forfeited			(47	)			68.21
Nonvested at end of year			1,523			$	77.37

There were 562,006 shares of performance-based stock awards, with a weighted average grant date fair value of $76.71, granted in fiscal 2018, 513,573 shares of performance-based stock awards, with a weighted average grant date fair value of $78.50, granted in fiscal 2017, and 696,057 shares of performance-based stock awards, with a weighted average grant date fair value of $70.41, granted in fiscal 2016. The fair value of performance-based stock awards that vested was $35.2 million in fiscal 2018, $38.5 million in fiscal 2017, and $27.1 million in fiscal 2016.

Other Awards: TJX also awards deferred shares to its outside directors under the Stock Incentive Plan. The outside directors are awarded two annual deferred share awards, each representing shares of TJX common stock, which were valued at $80,000 for fiscal 2018. One award vests immediately and is payable, with accumulated dividends, in stock at the earlier of separation from service as a director or a change of control. The second award vests based on a director’s continued service until the annual meeting that follows the grant of the award (subject to possible earlier vesting in connection with or following a change of control) and is payable, with accumulated dividends, in stock upon vesting unless an irrevocable advance election is made whereby it is payable at the same time as the first award. As of the end of fiscal 2018, a total of 331,595 of these deferred shares were outstanding under the plan.

Note I. Pension Plans and Other Retirement Benefits

Pension****: TJX has a funded defined benefit retirement plan that covers eligible U.S. employees hired prior to February 1, 2006. No employee contributions are required, or permitted, and benefits are based principally on compensation earned in each year of service. TJX’s funded defined benefit retirement plan assets are invested in domestic and international equity and fixed income securities, both directly and through investment funds. The plan does not invest in TJX securities. TJX also has an unfunded supplemental retirement plan that covers certain key employees and provides additional retirement benefits based on final average compensation for certain of those employees (the “primary benefit”) or, alternatively, based on benefits that would be provided under the funded retirement plan absent Internal Revenue Code limitations (the “alternative benefit”).

Presented below is financial information relating to TJX’s funded defined benefit pension plan (“qualified pension plan” or “funded plan”) and its unfunded supplemental pension plan (“unfunded plan”) for the fiscal years indicated. The Company has elected the practical expedient pursuant to ASU 2015-04– Compensation-retirement benefits (Topic 715) and has selected the measurement date of January 31, the calendar month end closest to the Company’s fiscal year end.

		Funded Plan Fiscal Year Ended								Unfunded Plan Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017				February 3, 2018				January 28, 2017
			(53 weeks	)							(53 weeks	)
Change in projected benefit obligation:
Projected benefit obligation at beginning of year		$	1,269,010			$	1,213,000				$86,309			$	84,967
Service cost			46,845				45,440				1,888				1,835
Interest cost			55,301				56,094				3,316				3,391
Actuarial losses			67,232				91,114				4,580				740
Settlements			—				(103,197	)			—				—
Benefits paid			(30,993	)			(28,751	)			(5,046	)			(4,624	)
Expenses paid			(3,306	)			(4,690	)			—				—
Projected benefit obligation at end of year		$	1,404,089			$	1,269,010				$91,047			$	86,309
Accumulated benefit obligation at end of year		$	1,277,216			$	1,151,151				$77,668			$	71,273

F-24

		Funded Plan Fiscal Year Ended								Unfunded Plan Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017				February 3, 2018				January 28, 2017
			(53 weeks	)							(53 weeks	)
Change in plan assets:
Fair value of plan assets at beginning of year		$	1,176,960			$	1,119,842			$	—			$	—
Actual return on plan assets			174,870				143,756				—				—
Employer contribution			100,000				50,000				5,046				4,624
Settlements			—				(103,197	)			—				—
Benefits paid			(30,993	)			(28,751	)			(5,046	)			(4,624	)
Expenses paid			(3,306	)			(4,690	)			—				—
Fair value of plan assets at end of year		$	1,417,531			$	1,176,960			$	—			$	—
Reconciliation of funded status:
Projected benefit obligation at end of year		$	1,404,089			$	1,269,010			$	91,047			$	86,309
Fair value of plan assets at end of year			1,417,531				1,176,960				—				—
Funded status – excess (asset) obligation		$	(13,442	)		$	92,050			$	91,047			$	86,309
Net (asset) liability recognized on consolidated balance sheets		$	(13,442	)		$	92,050			$	91,047			$	86,309
Amounts not yet reflected in net periodic benefit cost and included in accumulated other comprehensive income (loss):
Prior service cost		$	1,935			$	2,313			$	—			$	—
Accumulated actuarial losses			243,761				303,612				28,164				26,438
Amounts included in accumulated other comprehensive income (loss)		$	245,696			$	305,925			$	28,164			$	26,438

The Consolidated Balance Sheets reflect the funded status of the plans with any unrecognized prior service cost and actuarial gains and losses recorded in accumulated other comprehensive income (loss). The combined net accrued liability of $77.6 million at February 3, 2018 is reflected on the balance sheet as of that date as a current liability of $2.4 million, a long-term liability of $88.6 million, and a long-term asset of $13.4 million. The combined net accrued liability of $178.4 million at January 28, 2017 is reflected on the balance sheet as of that date as a current liability of $4.0 million and a long-term liability of $174.4 million.

The estimated prior service cost that will be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost in fiscal 2019 for the funded plan is $0.4 million. The estimated net actuarial loss that will be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost in fiscal 2019 is $12.1 million for the funded plan and $3.3 million for the unfunded plan.

TJX determined the assumed discount rate using the BOND: Link model in fiscal 2018 and fiscal 2017. TJX uses the BOND: Link model as this model allows for the selection of specific bonds resulting in better matches in timing of the plans’ expected cash flows. Presented below are weighted average assumptions for measurement purposes for determining the obligation at the year-end measurement date:

		Funded Plan Fiscal Year Ended								Unfunded Plan Fiscal Year Ended
		February 3, 2018				January 28, 2017				February 3, 2018				January 28, 2017
Discount rate			4.00	%			4.40	%			3.80	%			4.00	%
Rate of compensation increase			4.00	%			4.00	%			6.00	%			6.00	%

TJX made aggregate cash contributions of $105.0 million in fiscal 2018, $54.6 million in fiscal 2017 and $55.7 million in fiscal 2016 to the funded plan and to fund current benefit and expense payments under the unfunded plan. TJX’s policy with respect to the funded plan is to fund, at a minimum, the amount required to maintain a funded status of 80% of the applicable pension liability (the Funding Target pursuant to the Internal Revenue Code section 430) or such other amount as is sufficient to avoid restrictions with respect to the funding of nonqualified plans under

F-25

the Internal Revenue Code. We do not anticipate any required funding in fiscal 2019 for the funded plan. We anticipate making contributions of $2.4 million to provide current benefits coming due under the unfunded plan in fiscal 2019.

The following are the components of net periodic benefit cost and other amounts recognized in other comprehensive income (loss) related to our pension plans:

		Funded Plan Fiscal Year Ended												Unfunded Plan Fiscal Year Ended
Dollars in thousands		February 3, 2018				January 28, 2017				January 30, 2016				February 3, 2018				January 28, 2017				January 30, 2016
			(53 weeks	)											(53 weeks	)
Net periodic pension cost:
Service cost			$ 46,845				$ 45,440			$	50,080				$ 1,888				$ 1,835				$ 1,562
Interest cost			55,301				56,094				51,710				3,316				3,391				3,033
Expected return on plan assets			(69,345	)			(70,535	)			(78,042	)			—				—				—
Amortization of prior service cost			377				377				377				—				—				—
Amortization of net actuarial loss			21,557				31,397				33,146				2,852				3,349				3,958
Settlement charge			—				31,173				—				—				—				—
Total expense			$ 54,735				$ 93,946			$	57,271				$ 8,056				$ 8,575				$ 8,553
Other changes in plan assets and benefit obligations recognized in other comprehensive income:
Net (gain) loss			$(38,293	)			$ 17,894			$	(19,731	)			$ 4,580				$ 740				$ 3,806
Amortization of net (loss)			(21,557	)			(31,397	)			(33,146	)			(2,852	)			(3,349	)			(3,958	)
Settlement charge			—				(31,173	)			—				—				—				—
Amortization of prior service cost			(377	)			(377	)			(377	)			—				—				—
Total recognized in other comprehensive income (loss)			$(60,227	)			$(45,053	)		$	(53,254	)			$ 1,728				$(2,609	)			$ (152	)
Total recognized in net periodic benefit cost and other comprehensive income (loss)			$ (5,492	)			$ 48,893			$	4,017				$ 9,784				$ 5,966				$ 8,401
Weighted average assumptions for expense purposes:
Discount rate			4.40%				4.80%/3.80%				4.00%				4.00%				4.20%				3.70%
Expected rate of return on plan assets			6.00%				6.50%/6.00%				6.75%				N/A				N/A				N/A
Rate of compensation increase			4.00%				4.00%				4.00%				6.00%				6.00%				6.00%

During the third quarter of fiscal 2017, TJX offered eligible former TJX Associates, who had not yet commenced receiving their pension benefit, an opportunity to receive a lump sum payout of their vested pension benefit. On October 21, 2016, the Company’s pension plan paid $103.2 million from pension plan assets to those who accepted this offer, thereby reducing its pension benefit obligations. The transaction had no cash impact on TJX but did result in a non-cash pre-tax pension settlement charge of $31.2 million, which is reported separately on the Consolidated Statements of Income. As a result of the lump sum payout the Company re-measured the funded status of its pension plan as of September 30, 2016. The assumptions for pension expense presented above includes a discount rate of 4.80% through the measurement date and 3.80% thereafter. The expected rate of return on plan assets is 6.50% through the measurement date and 6.00% thereafter.

The rate of compensation increase presented for the unfunded plan (for measurement purposes and expense purposes) is the rate assumed for participants eligible for the primary benefit. The assumed rate of compensation increase for participants eligible for the alternative benefit under the unfunded plan is the same rate as assumed for the funded plan.

F-26

TJX develops its long-term rate of return assumption by evaluating input from professional advisors taking into account the asset allocation of the portfolio and long-term asset class return expectations, as well as long-term inflation assumptions.

The unrecognized gains and losses in excess of 10% of the projected benefit obligation are amortized over the average remaining service life of participants.

The following is a schedule of the benefits expected to be paid in each of the next five fiscal years and in the aggregate for the five fiscal years thereafter:

In thousands		Funded Plan Expected Benefit Payments				Unfunded Plan Expected Benefit Payments
Fiscal Year
2019		$	40,133			$	2,483
2020			43,782				42,591
2021			47,693				3,517
2022			52,158				4,503
2023			56,718				4,972
2024 through 2028			352,753				27,953

The following table presents the fair value hierarchy (See Note F – Fair Value Measurements of Notes to Consolidated Financial Statements) for pension assets measured at fair value on a recurring basis as of February 3, 2018 and January 28, 2017:

		Funded Plan at February 3, 2018
In thousands		Level 1				Level 2				Total
Asset category:
Short-term investments		$	109,183			$	—			$	109,183
Equity Securities			279,635				—				279,635
Fixed Income Securities:
Corporate and government bond funds			—				420,117				420,117
Futures Contracts			—				337				337
Total assets in the fair value hierarchy		$	388,818			$	420,454			$	809,272
Assets measured at net asset value*			—				—				608,259
Fair value of assets		$	388,818			$	420,454			$	1,417,531

		Funded Plan at January 28, 2017
In thousands		Level 1				Level 2				Total
Asset category:
Short-term investments		$	63,704			$	—			$	63,704
Equity Securities			208,451				—				208,451
Fixed Income Securities:
Corporate and government bond funds			—				386,777				386,777
Futures Contracts			—				(31	)			(31	)
Total assets in the fair value hierarchy		$	272,155			$	386,746			$	658,901
Assets measured at net asset value*			—				—				518,059
Fair value of assets		$	272,155			$	386,746			$	1,176,960

*	In accordance with Subtopic 820-10, certain investments that were measured using net asset value per share (or its equivalent) as a practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the fair value of assets presented above.

Pension plan assets are reported at fair value. Investments in equity securities traded on a national securities exchange are valued at the composite close price, as reported in the Wall Street Journal, as of the financial statement date. This information is provided by the independent pricing sources.

F-27

Short-term investments are primarily cash related to funding of the plan which had yet to be invested as of balance sheet dates.

Certain corporate and government bonds are valued at the closing price reported in the active market in which the bond is traded. Other bonds are valued based on yields currently available on comparable securities of issuers with similar credit ratings. When quoted prices are not available for identical or similar bonds, the bond is valued under a discounted cash flow approach that maximizes observable inputs, such as current yields of similar instruments, but includes adjustments for certain risks that may not be observable, such as credit and liquidity risks. All bonds are priced by independent pricing sources.

Assets measured at net asset value include investments in limited partnerships which are stated at the fair value of the plan’s partnership interest based on information supplied by the partnerships as compared to financial statements of the limited partnership or other fair value information as determined by management. Cash equivalents or short-term investments are stated at cost which approximates fair value, and the fair value of common/collective trusts is determined based on net asset value as reported by their fund managers.

The following is a summary of TJX’s target allocation guidelines for plan assets along with the actual allocation of plan assets as of the valuation date for the fiscal years presented:

						Actual Allocation for Fiscal Year Ended
		Target Allocation				February 3, 2018				January 28, 2017
Return-seeking assets			50%				47%				44%
Liability-hedging assets			50%				46%				51%
All other – primarily cash			—				7%				5%

Under TJX’s investment policy, plan assets are to be invested with the objective of generating investment returns that, in combination with funding contributions, provide adequate assets to meet all current and reasonably anticipated future benefit obligations under the plan. Effective January 1, 2017, the investment policy includes a dynamic asset allocation strategy, whereby, over time, in connection with any improvements in the plan’s funded status, the target allocation of return-seeking assets (generally, equities and other instruments with similar risk profile) may decline and the target allocation of liability-hedging assets (generally, fixed income and other instruments with a similar risk profile) may increase. Risks are sought to be mitigated through asset diversification and the use of multiple investment managers. Investment risk is measured and monitored on an ongoing basis through quarterly investment portfolio reviews, annual liability measurements and periodic asset/liability studies.

TJX also sponsors an employee savings plan under Section 401(k) of the Internal Revenue Code for all eligible U.S. employees and a similar type of plan for eligible employees in Puerto Rico. Assets under the plans totaled $1,787.9 million as of December 31, 2017 and $1,480.9 million as of December 31, 2016, and are invested in a variety of funds. Employees may contribute up to 50% of eligible pay, subject to limitations. TJX matches employee contributions, up to 5% of eligible pay, including a basic match at rates of 25% or 75% (based upon date of hire and other eligibility criteria) plus a discretionary match, generally up to 25%, based on TJX’s performance. TJX may also make additional discretionary contributions. Eligible employees are automatically enrolled in the U.S. plan at a 2% deferral rate, unless the employee elects otherwise. The total cost to TJX for these plans was $54.5 million in fiscal 2018, $45.6 million in fiscal 2017 and $41.9 million in fiscal 2016. The plans include a TJX stock fund in which participants could invest a portion of TJX’s matching contribution. The TJX stock fund was closed to new investments, other than reinvestment of dividends, at the end of calendar 2015 and subsequent to year-end, was eliminated from the plans. The TJX stock fund represented 3.9% of plan assets at December 31, 2017 and 6.2% of plan assets at December 31, 2016.

TJX also has a nonqualified savings plan (the Executive Savings Plan) for certain U.S. employees. TJX matches employee deferrals at various rates which amounted to $6.3 million in fiscal 2018, $5.8 million in fiscal 2017 and $4.5 million in fiscal 2016. Although the plan is unfunded, in order to help meet its future obligations TJX transfers an amount generally equal to employee deferrals and the related company match to a separate “rabbi” trust. The trust assets, which are invested in a variety of mutual funds, are included in other assets on the balance sheets.

F-28

In addition to the plans described above, TJX also maintains retirement/deferred savings plans for eligible associates at its foreign subsidiaries. We contributed $12.6 million for these plans in fiscal 2018, $10.2 million for these plans in fiscal 2017 and $9.7 million in fiscal 2016.

Multiemployer Pension Plans: TJX contributes to certain multiemployer defined benefit pension plans under the terms of collective-bargaining agreements that cover union-represented employees. TJX contributed $16.3 million in fiscal 2018, $14.5 million in fiscal 2017 and $13.4 million in fiscal 2016 to the Legacy Plan of the National Retirement Fund (formerly, the National Retirement Fund) (EIN #13-6130178, plan #001) and the Adjustable Plan of the National Retirement Fund (EIN #13-6130178, plan #002) and was listed in each plan’s Form 5500 as providing more than 5% of the total contributions for the plan year ending December 31, 2016. Based on information available to TJX, the Pension Protection Act Zone Status of the Legacy Plan of the National Retirement Fund is Critical and a rehabilitation plan has been implemented. In addition, based on information available to TJX, a portion of the National Retirement Fund that is related to UNITE HERE participants was transferred to a newly established fund at the end of 2017. TJX has not yet determined the effect of any such transfer.

The risks of participating in multiemployer pension plans are different from the risks of single-employer pension plans in certain respects, including the following: (a) assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers; (b) if a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers; (c) if we cease to have an obligation to contribute to a multiemployer plan in which we had been a contributing employer, or in certain other circumstances, we may be required to pay to the plan an amount based on our allocable share of the underfunded status of the plan, referred to as a withdrawal liability.

Postretirement Medical****: TJX previously maintained a postretirement medical plan that provided limited postretirement medical benefits to retirees who were eligible for the defined benefit plan and who retired at age 55 or older with ten or more years of service. During fiscal 2006, TJX eliminated this benefit for all active associates and modified the benefit that was offered to retirees enrolled in the plan at that time.

During the first quarter of fiscal 2017, TJX terminated the unfunded postretirement medical plan and made a discretionary lump sum payment to participants. The settlement of the liability and the recognition of the remaining negative plan amendment resulted in a pre-tax benefit of $5.5 million in the first quarter of fiscal 2017.

Note J. Long-Term Debt and Credit Lines

The table below presents long-term debt, exclusive of current installments, as of February 3, 2018 and January 28, 2017. All amounts are net of unamortized debt discounts.

In thousands		February 3, 2018				January 28, 2017
General corporate debt:
2.50% senior unsecured notes, maturing May 15, 2023 (effective interest rate of 2.51% after reduction of unamortized debt discount of $234 and $278 in fiscal 2018 and 2017, respectively)		$	499,766			$	499,722
2.75% senior unsecured notes, maturing June 15, 2021 (effective interest rate of 2.76% after reduction of unamortized debt discount of $250 and $325 in fiscal 2018 and 2017, respectively)			749,750				749,675
2.25% senior unsecured notes, maturing September 15, 2026 (effective interest rate of 2.32% after reduction of unamortized debt discount of $6,403 and $7,149 in fiscal 2018 and 2017, respectively)			993,597				992,851
Debt issuance cost			(12,506	)			(14,649	)
Long-term debt		$	2,230,607			$	2,227,599

F-29

The aggregate maturities of long-term debt, inclusive of current installments at February 3, 2018 are as follows:

In thousands		Long-Term Debt
Fiscal Year 2019		$	—
2020			—
2021			—
2022			750,000
2023			—
Later years			1,500,000
Less amount representing unamortized debt discount			(6,887	)
Less amount representing debt issuance cost			(12,506	)
Aggregate maturities of long-term debt		$	2,230,607

On September 12, 2016, TJX issued $1.0 billion aggregate principal amount of 2.25% ten-year notes due September 2026. TJX entered into a rate-lock agreement to hedge $700 million of the 2.25% notes. The cost of these agreements are being amortized to interest expense over the term of the notes resulting in an effective fixed rate of 2.36%. On October 12, 2016, TJX used a portion of the proceeds from the 2.25% ten-year notes to redeem all outstanding 6.95% ten-year notes and recorded a pre-tax loss on the early extinguishment of debt of $51.8 million, which includes $50.6 million of redemption premium and $1.2 million to write off unamortized debt expenses and discount.

At February 3, 2018, TJX also had outstanding $500 million aggregate principal amount of 2.50% ten-year notes due May 2023 and $750 million aggregate principal amount of 2.75% seven-year notes due June 2021. TJX entered into rate-lock agreements to hedge the underlying treasury rate of $250 million of the 2.50% notes. The costs of these agreements are being amortized to interest expense over the term of the respective notes, resulting in an effective fixed interest rate of 2.57% for the 2.50% notes. TJX also entered into rate-lock agreements to hedge the underlying treasury rate of all of the 2.75% notes prior to their issuance. The agreements were accounted for as cash flow hedges and the pre-tax realized loss of $7.9 million was recorded as a component of other comprehensive income and is being amortized to interest expense over the term of the notes, resulting in an effective fixed interest rate of 2.91%.

At February 3, 2018, TJX had two $500 million revolving credit facilities, one which matures in March 2020 and one which matures in March 2022. The $500 million revolving credit facility maturing in March 2020 was also outstanding at January 28, 2017, while the facility maturing in 2022 had a March 2021 maturity date as of that date. In March 2017, the maturity of the $500 million revolving credit facility scheduled to mature in March 2021 was extended to March 2022. No other terms of the facility were modified at that time.

The terms and covenants under the revolving credit facilities require quarterly payments of 6.0 basis points per annum on the committed amounts for both agreements. This rate is based on the credit ratings of TJX’s long-term debt and will vary with specified changes in the credit ratings. These agreements have no compensating balance requirements and have various covenants. Each of these facilities require TJX to maintain a ratio of funded debt and four-times consolidated rentals to consolidated earnings before interest, taxes, consolidated rentals, depreciation and amortization (EBITDAR) of not more than 2.75 to 1.00 on a rolling four-quarter basis. TJX was in compliance with all covenants related to its credit facilities at the end of all periods presented. As of February 3, 2018 and January 28, 2017, and during the years then ended, there were no amounts outstanding under these facilities.

As of February 3, 2018 and January 28, 2017, TJX Canada had two uncommitted credit lines, a C$10 million facility for operating expenses and a C$10 million letter of credit facility. As of February 3, 2018 and January 28, 2017, and during the years then ended, there were no amounts outstanding on the Canadian credit line for operating expenses. As of February 3, 2018 and January 28, 2017, our European business at TJX International had an uncommitted credit line of £5 million. As of February 3, 2018 and January 28, 2017, and during the years then ended, there were no amounts outstanding on the European credit line.

F-30

Note K. Income Taxes

The 2017 Tax Act made broad and complex changes to the U.S. tax code which had a significant impact on our 2017 tax expense, including reducing the U.S. federal corporate tax rate from 35% to 21%, expanded rules regarding expensing of fixed assets, and required one-time transition tax on certain undistributed earnings of foreign subsidiaries. Other provisions that are not yet effective but may impact income taxes in future years include: an exemption from U.S. tax on dividends of future foreign earnings, expanded limitations on executive compensation, and a minimum tax on certain foreign earnings in excess of 10% of the foreign subsidiaries tangible assets (i.e. global intangible low-taxed income or “GILTI”). Because of the complexity of the new provisions, the Company is continuing to evaluate how the provisions will be accounted under GAAP. We do not expect these provisions to have a significant impact on the Company when effective.

In December 2017, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 118, which allows a measurement period, not to exceed one year, to finalize the accounting for the income tax impacts of the 2017 Tax Act. To the extent our accounting for certain income tax effects of the 2017 Tax Act is incomplete but we are able to determine a reasonable estimate, we recorded a provisional estimate in the financial statements. The provisional tax benefit of the 2017 Tax Act is based on currently available information and interpretations, which are continuing to evolve. We will continue to analyze additional information and guidance related to the 2017 Tax Act as supplemental legislation, regulatory guidance, or evolving technical interpretations become available. The final impacts may differ from the recorded amounts as of February 3, 2018, and we will continue to refine such amounts within the measurement period provided by Staff Accounting Bulletin No. 118. We expect to complete our analysis no later than the fourth quarter of fiscal 2019.

For financial reporting purposes, components of income before income taxes are as follows:

		Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017				January 30, 2016
			(53 weeks	)
United States		$	3,255,057			$	3,196,370			$	3,102,304
Foreign			601,531				526,673				555,996
Income before provision for income taxes		$	3,856,588			$	3,723,043			$	3,658,300

The provision for income taxes includes the following:

		Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017				January 30, 2016
			(53 weeks	)
Current:
Federal		$	1,063,141			$	1,068,778			$	992,094
State			160,650				213,505				208,357
Foreign			161,974				148,367				149,408
Deferred:
Federal			(164,523	)			(3,107	)			34,620
State			27,595				(10,583	)			(9,979	)
Foreign			(197	)			7,849				6,142
Provision for income taxes		$	1,248,640			$	1,424,809			$	1,380,642

F-31

TJX had net deferred tax (liabilities) assets as follows:

		Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017
Deferred tax assets:
Net operating loss carryforward		$	40,088			$	27,396
Reserves for lease obligations			3,637				5,107
Pension, stock compensation, postretirement and employee benefits			232,887				412,391
Leases			42,999				57,223
Accruals and reserves			51,281				67,662
Other			25,599				48,463
Total gross deferred tax assets		$	396,491			$	618,242
Valuation allowance			(42,332	)			(29,273	)
Net deferred tax asset		$	354,159			$	588,969
Deferred tax liabilities:
Property, plant and equipment		$	437,621			$	569,377
Capitalized inventory			45,125				51,077
Tradename/intangibles			12,628				51,976
Undistributed foreign earnings			65,013				213,948
Other			20,271				10,398
Total deferred tax liabilities		$	580,658			$	896,776
Net deferred tax (liability)		$	(226,499	)		$	(307,807	)
Non-current asset		$	6,558			$	6,193
Non-current liability			(233,057	)			(314,000	)
Total		$	(226,499	)		$	(307,807	)

TJX has provided for all applicable state and foreign withholding taxes on all undistributed earnings of its foreign subsidiaries in Canada, Puerto Rico, Italy, India, Hong Kong and Vietnam through February 3, 2018. We have not provided for state and foreign withholding taxes on the approximately $1 billion of undistributed earnings related to all other foreign subsidiaries as we have provisionally asserted that these earnings are indefinitely reinvested in the business. The net amount of unrecognized state and foreign withholding tax liabilities related to the undistributed earnings is approximately $31 million.

As of February 3, 2018 and January 28, 2017, for state income tax purposes, TJX had net operating loss carryforwards of $113.9 million and $99.2 million respectively, which expire, if unused, in the years 2019 through 2037. TJX has analyzed the realization of the state net operating loss carryforwards on an individual state basis. For those states where the Company has determined that it is more likely than not that the state net operating loss carryforwards will not be realized, a valuation allowance of $8.9 million has been provided for the deferred tax asset as of February 3, 2018 and $6.8 million as of January 28, 2017.

As of February 3, 2018 and January 28, 2017, the Company had available for foreign income tax purposes (related to Australia, Austria and the Netherlands) net operating loss carryforwards of $111 million and $75 million respectively, of which $13.6 million will expire, if unused, in fiscal years 2025 through 2027. The remaining loss carryforwards do not expire. For the deferred tax assets associated with the net operating loss carryforwards for which management has determined it is more likely than not that the deferred tax assets will not be realized, TJX had valuation allowances recorded of approximately $33.4 million as of February 3, 2018, and approximately $22.5 million as of January 28, 2017.

F-32

The difference between the U.S. federal statutory income tax rate and TJX’s worldwide effective income tax rate is reconciled below:

		Fiscal Year Ended
		February 3, 2018				January 28, 2017				January 30, 2016
		(53 weeks)
U.S. federal statutory income tax rate			33.7	%			35.0	%			35.0	%
Effective state income tax rate			3.6				3.5				3.5
Impact of foreign operations			(0.1	)			(0.2	)			(0.7	)
Excess share-based compensation			(1.3	)			—				—
Impact of 2017 Tax Act			(2.3	)			—				—
All other			(1.2	)			—				(0.1	)
Worldwide effective income tax rate			32.4	%			38.3	%			37.7	%

TJX’s U.S. federal statutory rate of 33.7% is a blended rate of the year due to the enactment of the 2017 Tax Act. TJX’s effective income tax rate decreased for fiscal 2018 as compared to fiscal 2017. The decrease in the effective income tax rate was primarily due to the favorable effect of the 2017 Tax Act, excess tax benefit from share-based compensation attributable to the adoption of ASU 2016-09, and the jurisdictional mix of income.

We have reasonably estimated the effects of the 2017 Tax Act and recorded a provisional benefit of approximately $88 million in our financial statements as of February 3, 2018. This amount consists of a net benefit of $281 million for the remeasurement of deferred taxes as of December 22, 2017 due to the corporate tax rate reduction and the reversal of all previous deferred U.S. tax liabilities, reduced for the applicable state and foreign withholding taxes, on undistributed earnings, reduced by a net expense of $193 million for the transition tax of which, $16 million is expected to be paid during fiscal 2019.

TJX had net unrecognized tax benefits (net of federal benefit on state issues) of $57.3 million as of February 3, 2018, $38.5 million as of January 28, 2017 and $34.1 million as of January 30, 2016.

A reconciliation of the beginning and ending gross amount of unrecognized tax benefits is as follows:

		Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017				January 30, 2016
Balance at beginning of year		$	49,092			$	43,326			$	55,619
Additions for uncertain tax positions taken in current year			6,504				7,018				2,248
Additions for uncertain tax positions taken in prior years			7,990				327				11,707
Reductions for uncertain tax positions taken in prior years			(587	)			(334	)			(23,874	)
Reductions resulting from lapse of statute of limitations			(1,295	)			(1,245	)			(389	)
Settlements with tax authorities			—				—				(1,985	)
Balance at end of year		$	61,704			$	49,092			$	43,326

Included in the gross amount of unrecognized tax benefits are items that will impact future effective tax rates upon recognition. These items amounted to $55.8 million as of February 3, 2018, $43.8 million as of January 28, 2017 and $39.0 million as of January 30, 2016.

TJX is subject to U.S. federal income tax as well as income tax in multiple state, local and foreign jurisdictions. In the U.S., fiscal years through 2010 are no longer subject to examination. In Canada, fiscal years through 2008 are no longer subject to examination. In all other jurisdictions, fiscal years through 2009 are no longer subject to examination.

TJX’s accounting policy is to classify interest and penalties related to income tax matters as part of income tax expense. The amount of interest and penalties expensed was $1.9 million for the year ended February 3, 2018, $1.4 million for the year ended January 28, 2017 and $1.6 million for the year ended January 30, 2016. The accrued amounts for interest and penalties are $11.9 million as of February 3, 2018, $8.0 million as of January 28, 2017 and $7.0 million as of January 30, 2016.

F-33

Based on the final resolution of tax examinations, judicial or administrative proceedings, changes in facts or law, expirations of statute of limitations in specific jurisdictions or other resolutions of, or changes in, tax positions, it is reasonably possible that unrecognized tax benefits for certain tax positions taken on previously filed tax returns may change materially from those represented on the financial statements as of February 3, 2018. During the next twelve months, it is reasonably possible that state tax audit resolutions may reduce unrecognized tax benefits by $0 to $21 million, which would reduce the provision for taxes on earnings.

Note L. Commitments

TJX is committed under long-term leases related to its continuing operations for the rental of real estate and fixtures and equipment. Most of TJX’s leases are store operating leases with ten-year terms and options to extend for one or more five-year periods in the U.S. and Canada and ten to fifteen year terms in Europe and Australia, some of which have options to extend. Many of the Company’s leases contain escalation clauses and we have the right to terminate some of the leases before the expiration date under specified circumstances and some with specified payments. In addition, TJX is generally required to pay insurance, real estate taxes and other operating expenses including, in some cases, rentals based on a percentage of sales. These expenses in the aggregate were approximately one-third of the total minimum rent in fiscal 2018, fiscal 2017 and fiscal 2016 and are not included in the table below.

The following is a schedule of future minimum lease payments for continuing operations as of February 3, 2018:

In thousands		Operating Leases
Fiscal Year 2019		$	1,600,536
2020			1,534,650
2021			1,389,854
2022			1,208,046
2023			1,025,314
Later years			2,736,351
Total future minimum lease payments		$	9,494,751

Rental expense under operating leases for continuing operations amounted to $1,591.4 million for fiscal 2018, $1,435.2 million for fiscal 2017 and $1,365.6 million for fiscal 2016. Rental expense includes contingent rent and is reported net of sublease income. Contingent rent paid was $18.4 million in fiscal 2018, $14.7 million in fiscal 2017 and $15.7 million in fiscal 2016. Sublease income was $1.3 million in fiscal 2018, $1.2 million in fiscal 2017 and $0.9 million in fiscal 2016.

As of February 3, 2018 we have a number of lease agreements for facilities and stores that resulted in TJX being considered the owner of the property for accounting purposes (see Lease Accounting within Note A – Basis of Presentation and Summary of Accounting Policies of Notes to Consolidated Financial Statements). The assets related to these properties are included in “land and buildings” and the related liabilities of $221.9 million are included in “other long-term liabilities.”

TJX had outstanding letters of credit totaling $40.2 million as of February 3, 2018 and $41.2 million as of January 28, 2017. Letters of credit are issued by TJX primarily for the purchase of inventory.

F-34

Note M. Accrued Expenses and Other Liabilities, Current and Long Term

The major components of accrued expenses and other current liabilities are as follows:

		Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017
Employee compensation and benefits, current		$	686,294			$	630,049
Dividends payable			199,029				170,490
Accrued capital additions			90,336				111,963
Rent, utilities and occupancy, including real estate taxes			234,183				214,001
Merchandise credits and gift certificates			399,482				362,473
Insurance			87,546				84,363
Sales tax collections and V.A.T. taxes			200,005				199,602
All other current liabilities			626,086				547,523
Accrued expenses and other current liabilities		$	2,522,961			$	2,320,464

All other current liabilities include accruals for advertising, customer rewards liability, interest, reserve for sales returns, reserve for taxes, fair value of derivatives, expense payables, purchased services and other items, each of which is individually less than 5% of current liabilities.

The major components of other long-term liabilities are as follows:

		Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017
Employee compensation and benefits, long term		$	442,624			$	471,728
Accrued rent			263,178				231,681
Landlord allowances			88,747				77,887
Income taxes payable			176,772				—
Tax reserve, long term			44,753				36,713
Financing lease obligations			221,917				176,232
Asset retirement obligation			49,266				45,573
All other long-term liabilities			33,248				34,140
Other long-term liabilities		$	1,320,505			$	1,073,954

Note N. Contingent Obligations and Contingencies

Contingent Obligations: TJX has contingent obligations on leases, for which it was a lessee or guarantor, which were assigned to third parties without TJX being released by the landlords. Over many years, TJX has assigned numerous leases that it had originally leased or guaranteed to a significant number of third parties. With the exception of leases of former businesses for which TJX has reserved, the Company has rarely had a claim with respect to assigned leases, and accordingly, the Company does not expect that such leases will have a material adverse impact on our financial condition, results of operations or cash flows. TJX does not generally have sufficient information about these leases to estimate our potential contingent obligations under them, which could be triggered in the event that one or more of the current tenants does not fulfill their obligations related to one or more of these leases.

TJX may also be contingently liable on up to eight leases of former TJX businesses, for which we believe the likelihood of future liability to TJX is remote, and has contingent obligations in connection with certain assigned or sublet properties that TJX is able to estimate. We estimate that the undiscounted obligations of (i) leases of former operations not included in our reserve for former operations and (ii) properties of our former operations if the subtenants do not fulfill their obligations, are approximately $48.7 million as of February 3, 2018. We believe that most or all of these contingent obligations will not revert to us and, to the extent they do, will be resolved for substantially less due to mitigating factors including our expectation to further sublet.

TJX is a party to various agreements under which it may be obligated to indemnify the other party with respect to certain losses related to such matters as title to assets sold, specified environmental matters or certain income taxes. These obligations are often limited in time and amount. There are no amounts reflected in our balance sheets with respect to these contingent obligations.

F-35

Contingencies: TJX is subject to certain legal proceedings, lawsuits, disputes and claims that arise from time to time in the ordinary course of our business. In addition, TJX is a defendant in several lawsuits filed in federal and state courts brought as putative class or collective actions on behalf of various groups of current and former salaried and hourly associates in the U.S. The lawsuits allege violations of the Fair Labor Standards Act and of state wage and hour and other labor statutes. TJX is also defending putative class action claims on behalf of customers relating to TJX’s compare at pricing. The lawsuits are in various procedural stages and seek monetary damages, injunctive relief and attorneys’ fees. In connection with ongoing litigation, an immaterial amount has been accrued in the accompanying financial statements.

Note O. Supplemental Cash Flows Information

TJX’s cash payments for interest and income taxes and non-cash investing and financing activities are as follows:

		Fiscal Year Ended
In thousands		February 3, 2018				January 28, 2017				January 30, 2016
		(53 weeks)
Cash paid for:
Interest on debt		$	64,308			$	72,619			$	64,188
Income taxes			1,289,964				1,282,172				1,301,122
Non-cash investing and financing activity:
Construction in progress		$	(27,207	)		$	(94,291	)		$	(30,767	)
Financing lease obligation			27,207				94,291				30,767
Dividends payable			29,836				29,195				20,315
Property additions			(21,627	)			(20,908	)			33,384

Note P. Selected Quarterly Financial Data (Unaudited)

Presented below is selected quarterly consolidated financial data for fiscal 2018 and fiscal 2017 which was prepared on the same basis as the audited consolidated financial statements and includes all adjustments necessary to present fairly, in all material respects, the information set forth therein on a consistent basis.

In thousands except per share amounts		First Quarter				Second Quarter				Third Quarter(2)				Fourth Quarter(3)
Fiscal Year Ended February 3, 2018 (53 weeks)
Net sales		$	7,784,024			$	8,357,700			$	8,762,220			$	10,960,720
Gross earnings(1)			2,253,952				2,385,025				2,612,200				3,111,320
Net income			536,279				552,957				641,436				877,276
Basic earnings per share			0.83				0.87				1.01				1.39
Diluted earnings per share			0.82				0.85				1.00				1.37
Fiscal Year Ended January 28, 2017 (52 weeks)
Net sales		$	7,542,356			$	7,882,053			$	8,291,688			$	9,467,647
Gross earnings(1)			2,170,213				2,319,092				2,447,815				2,680,870
Net income			508,346				562,174				549,786				677,928
Basic earnings per share			0.77				0.85				0.84				1.04
Diluted earnings per share			0.76				0.84				0.83				1.03

(1)	Gross earnings equal net sales less cost of sales, including buying and occupancy costs.

(2)	The third quarter of fiscal 2017 includes a loss on early extinguishment of debt and a pension settlement charge.

(3)	The fourth quarter of fiscal 2018 includes 14 weeks, a $99.3 million impairment charge and a net benefit related to the 2017 Tax Act.

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